Gearstd/iStock, Tyler Le/BI
TikTok's future in the US is looking dimmer.
A three-judge panel from the US Court of Appeals for the District of Columbia Circuit ruled on Friday that a law designed to force a TikTok sale or ban is constitutional.
Congress passed the law, called the Protecting Americans from Foreign Adversary Controlled Applications Act, in April. The law makes it illegal for companies like Apple and Google to host apps owned by a foreign adversary that permit users to "create an account or profile to generate, share, and view text, images, videos, real-time communications, or similar content."
It identified TikTok and its owner, ByteDance, as covered companies. ByteDance operates in China, which the US has deemed a foreign adversary.
The law gave ByteDance until January 19 to either divest itself of TikTok's US assets or be booted from app stores.
TikTok challenged the law in May, arguing that it violated its users' First Amendment rights. Its argument failed.
"The First Amendment exists to protect free speech in the United States," the court ruling says. "Here the Government acted solely to protect that freedom from a foreign adversary nation and to limit that adversary's ability to gather data on people in the United States."
TikTok said in response to the ruling on Friday that the law amounts to government censorship of the over 170 million Americans who use the app.
"The Supreme Court has an established historical record of protecting Americans' right to free speech, and we expect they will do just that on this important constitutional issue," TikTok said.
US officials in both parties have worried that the app poses a national security risk because of its Chinese owner. Some have raised concerns that ByteDance could be required to pass along US user data to the Chinese Communist Party, as mandated by a national intelligence law. Members of Congress have also said they fear that TikTok could be used as a propaganda tool to push narratives favorable to the CCP.
TikTok has said it doesn't share information with the Chinese government and emphasized that its content moderation is managed by a US-based team that "operates independently from China."
TikTok is likely to appeal the decision, and it may end up in front of the Supreme Court. If the Supreme Court upholds the ruling, TikTok may have a savior in President-elect Donald Trump.
Trump once tried to ban TikTok, but he's since flip-flopped and said he'd try to rescue the app once in office.
Legal experts previously told BI that the incoming president could instruct his Justice Department to not enforce the divest-or-ban law, or make a claim that it simply doesn't apply to TikTok. Both strategies may be tough to defend against a legal challenge, particularly if the Supreme Court rules against TikTok.
Trump could also try to broker a sale of TikTok to a new owner that isn't tied to a foreign adversary.
ByteDance has said it wouldn't sell TikTok's US assets, but it may be more open to the idea if other options are off the table.
Some members of Congress seem to prefer a sale. Rep. John Moolenaar, the chairman of the House Select Committee on the Strategic Competition Between the United States and the Chinese Communist Party, told BI in November that the Trump administration would "have a unique opportunity to broker an American takeover of the platform, allowing TikTok users to continue to enjoy a safer, better version of the app free from foreign-adversary control."
